Planning and Paying for College Grants, Scholarships, Loans and Other Money for College.

Planning and Paying for CollegeGrants, Scholarships, Loans and Other Money for College

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Welcome to this workshop on how to “Fund Your Future.”

Content and workbooks for this workshop are provided courtesy of the California Student Aid Commission and ECMC.

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Workshop Overview

■ Financial aid basics♦ Types of aid♦ How to apply

■ Free money♦ Cal Grant deadline

■ Loans♦ Federal loans♦ Private loans♦ Repaying your loan

■ Manage your money

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Types of California colleges

■ California Community Colleges (CCCs)■ California State University (CSU)■ University of California (UC)■ Independent and/or private colleges■ Career colleges■ Vocational/technical schools

In this workbook and presentation, college refers to any of these

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10 important things to qualify

1. Submit the FAFSA

2. Submit any other applications*

3. Demonstrate financial need

4. Have a high school diploma or equivalent

5. Be a U.S. citizen or eligible noncitizen

6. California residency

7. Enroll in an eligible degree or certificate program

8. Maintain satisfactory academic progress

9. Have an SSN

10.Register with U.S. Selective Service (males 18-25)

*and a verified GPA for a Cal Grant by March 2

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Types of financial aid

■ Grants are money you don’t have to repay, typically based on financial need.

■ Scholarships are free money, usually based on your area of study or merit.

■ Work-study or student employment programs—federal and college.

■ Loans are borrowed money that you must pay back, usually with interest.

Basic steps to financial aid

■ Prepare for college■ Apply for financial aid■ Pay for college■ Manage your money

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See the basic steps checklist on pages 2-3

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Free money from the government

■ Cal Grants♦ Cal Grant A: up to $12,192♦ Cal Grant B: up to $1,551 first year, up to $13,743 thereafter♦ Cal Grant C: up to $3,168

■ Federal Pell Grant ♦ Up to $5,550 a year

■ Federal Supplemental Educational Opportunity Grant ♦ Up to $4,000 a year

■ Federal TEACH Grant♦ Up to $4,000 a year

More information on pages 4-5

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Special programs and work-study

■ Fee waivers and other college-based programs♦ See your college financial aid office

■ Work-study♦ Federal work-study♦ College work-study

• Student employment programs

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Other California aid programs

■ UC Student Aid♦ Average grant $14,000

■ State University Grant♦ Full systemwide fees

■ California Chafee Grant♦ Up to $5,000 a year

■ Child Development Grant♦ Up to $2,000 a year

■ California National Guard Education Assistance Award♦ $1,551 - $12,192

■ Law Enforcement Personnel Dependents Grant♦ Up to $13,743 a year

See pages 4-5 for requirements

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Applying for financial aid

■ Collect your information♦ SSN, driver’s license number, email

address♦ Your financial records

■ Fill out the FAFSA on the Web Worksheet (www.fafsa.gov) ♦ Helps you prepare for the real FAFSA so

you’ll have everything you need

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FAFSA on the Web

■ Apply at www.fafsa.gov ■ Read all the instructions ■ Name must match your SSN■ E-sign your FAFSA using your PIN

♦ You can receive a PIN instantly when you complete the FAFSA

♦ Add this email address to your contacts to ensure you receive it: [email protected]

♦ Provide an email address to receive an estimate of your EFC instantly

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FAFSA on the Web

■ Print and keep a copy of the FAFSA you submit for your records♦ Also keep copies of the financial

information you used to complete the FAFSA

■ Use your PIN to:♦ check on the status ♦ make corrections to your FAFSA later

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Free help with the FAFSA

■ California Cash for College workshops ♦ January & February♦ www.californiacashforcollege.org

■ Help at www.fafsa.gov♦ Click on the Live Help button♦ www.studentaid.ed.gov/completefafsa for

help with the paper FAFSA

■ Phone: 1-800-433-3243 ♦ M-F til 9 p.m. Saturday til 3 p.m.

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Calculating financial need

■ Cost of attendance (COA)♦ Each college has its own student budget, or COA,

which includes tuition, fees, books, supplies, housing, food, transportation and personal expenses

■ Expected family contribution (EFC)♦ The amount of money the government believes you

or your family could reasonably contribute toward your education

■ Your demonstrated financial need Your COA

- Your EFC

= Your demonstrated financial need

More information on page 9

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Applying for a Cal Grant

Two forms, two steps■ Submit the FAFSA ■ Submit verified Cal Grant GPA

♦ When you finish your FAFSA, look for the link to the California site to answer any questions about your Cal Grant application

♦ Some schools automatically submit GPAs electronically for their students

♦ If not, fill out the Cal Grant GPA Verification Form and give it to a school official for verification before mailing

• Available at www.calgrants.org • Mail to the California Student Aid Commission

by March 2 deadline

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Tracking your Cal Grant

■ Track your Cal Grant and/or California Chafee Grant application or award

■ www.webgrants4students.org ♦ 24/7 access♦ Secure account♦ Make changes to your account

■ Avoid delays in getting your grant – keep your account updated

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Student Aid Report (SAR)

■ The SAR is a report from the federal processor summarizing the information you provided on the FAFSA♦ Receive within 72 hours if you submitted

the FAFSA online (up to 2 weeks for paper)♦ Review right away for accuracy

■ Lists your EFC for the school year♦ Located at the top of your SAR♦ No dollar sign next to it (e.g., 02500)

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Sample SAR email

■ Includes a link to your individual SAR♦ See example on page 13

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Sample SAR

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California Aid Report (CAR)

■ If you’re offered a Cal Grant, you’ll receive an email from the California Student Aid Commission called a CAR♦ You must list a valid email address on your

FAFSA so you can receive a CAR

■ The CAR lists the tentative Cal Grant award amount♦ If you did not get a Cal Grant, you’ll receive

notification explaining why♦ See sample CAR on page 13

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Sample CAR

■ See example

on page 13

■ Access your CAR online atwww.webgrants4students.org

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Evaluate financial aid offers

■ Compare offers■ Determine your

net costs■ See worksheet on

page 15

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Cal Grants: free money!

■ Up to $12,192 for college ♦ up to $3,168 for career or technical training

■ Can be used at:♦ University of California♦ California State University♦ California Community Colleges♦ Most independent colleges♦ Many career and technical schools

■ You don’t have to pay it back

When to apply for a Cal Grant

■ In your senior year of high school■ Within one year after graduating from a

California high school or receiving your GED

■ As a California Community College transfer student, as long as you are under age 28

■ By the March 2 Cal Grant deadline

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Cal Grant guarantee

■ You’re guaranteed to receive a Cal Grant award if you: ♦ are a high school senior or recent graduate,♦ apply by March 2, ♦ graduate from a California high school, ♦ meet income and asset ceilings♦ meet all other eligibility requirements, and ♦ have financial need based on your college

costs and your expected family contributionMore information on page 17

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To qualify for a Cal Grant:

■ Submit the FAFSA and your verified Cal Grant GPA by the March 2 deadline (see page 10)

■ Be a U.S. citizen or an eligible noncitizen♦ Be a California resident

■ Meet any minimum GPA requirements■ Attend a qualifying California college■ Have financial need based on your COA & EFC

♦ Meet income and asset ceilings (see pages 7 & 18)

■ Be enrolled at least half time■ Pass the CA High School Exit Exam (CAHSEE)

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Financial aid for specific populations

■ Athletes■ California Conservation Corps■ Students with dependents■ Students with disabilities■ Foster Youth

♦ California Chafee Grant♦ College-based tuition waivers/scholarships♦ Orphan Foundation of America

■ Military and their dependents■ California National Guard

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AB 540 – Undocumented students

■ Undocumented or underdocumented students may qualify for in-state tuition rates at UC, CSU and California Community Colleges♦ Completed at least 3 years of high school in California

and♦ Graduated from a California high school or received

your GED in California

■ Check with your college admissions office■ Additional resources available at:

♦ www.usc.edu/dept/chepa/pdf/AB_540_final.pdf♦ www.maldef.org/leadership/scholarships/

2010_Scholarship_list.pdf

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California Dream Act of 2011 (AB 130)

■ Undocumented/underdocumented students may also qualify for:♦ Institutional scholarships♦ Privately funded scholarships

■ Must meet qualifications for AB 540 in-state tuition rates

■ Check with your college admissions office

More information on pages 9 & 22

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California Dream Act of 2011 (AB 131)

■ Signed into law October 8, 2011■ Undocumented or other nonresident students may

also qualify for ♦ Cal Grants and other applicable state aid♦ The Board of Governors (BOG) Fee Waiver Program♦ Institutional aid

■ Students begin applying for Cal Grants in January 2013 (Note: This year’s seniors can apply next year)

■ Check with your college financial aid office for more information about the BOG Fee Waiver (at community colleges only) and institutional aid timelines and processes

Money for future teachers■ Cal Grant A and B extended benefits■ Federal TEACH Grants

♦ Up to $4,000 a year for tuition

■ APLE: California’s Assumption Program of Loans for Education♦ Assumes up to $19,000 of student loan debt in return for four years of teaching

service

■ Federal Loan Forgiveness for Teachers♦ Forgives federal Stafford loan debt

■ Federal Perkins Loan Forgiveness■ Federal Pell Grants

♦ May be used to attend a teacher credential program

■ Teach for America♦ Up to $5,350 a year to repay loans plus other benefits

■ SNAPLE: California’s State Nursing Assumption Program of Loans for Education

♦ Assumes up to $25,000 of student loan debt in return for teaching service

See chart on page 22

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Other ways to pay for college■ Private scholarships■ National Merit Scholarships■ Community service■ The military■ Credit for experience■ Earn credit in high school■ Cooperative education■ Part-time work■ Start at a community college■ ScholarShare college savings plan■ Company-paid education■ Tax benefits■ Jobs that help you repay loans

See pages 23-25 in your workbook

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Federal loans

■ Federal Stafford loans♦ Subsidized Stafford loans

• Based solely on demonstrated financial need• The federal government pays the interest while

you are in school

♦ Unsubsidized Stafford loans• All eligible students can receive them,

regardless of income or assets• You’re responsible for paying the interest while

in school

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Stafford loans

Want to know DetailsHow to get one First submit the FAFSA; your college’s financial aid office will

contact you later to complete the required steps, including signing a master promissory note and completing loan counseling

Interest rate Loans disbursed between July 1, 2012 and June 30, 2013 have a fixed 6.8 percent interest rate for the life of the loan

Fees A 1 percent loan fee will be deducted from each loan disbursement

Enrollment requirement At least half timeHow you’ll receive loan funds Funds are sent directly to your college to pay for tuition, fees, room

and board (if applicable); the remainder will be issued to you by your college

Repayment begins Six months after you graduate, leave school or enroll less than half time

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How much can you borrow?

■ It depends on:♦ Your college’s cost of attendance (COA)♦ Your expected family contribution (EFC)♦ How many years you’ve been in school♦ Whether you’re a dependent or an independent

student, and ♦ How much other financial aid you receive.

■ Your loan and any other financial aid you receive, including private aid, cannot be more than your cost of attendance

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Federal PLUS loans

■ Enable your parents or stepparents (whose information is reported on your FAFSA) to borrow up to the total cost of your undergraduate study♦ Less any other aid you may receive♦ Legal guardians cannot borrow PLUS

loans for your study

See chart on page 28

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Private loans

■ Often carry higher interest rates and fees than federal loans

■ May have less attractive repayment terms■ Typically the interest rates are variable

♦ Rates can change month to month

■ Usually based on your credit rating and debt-to-income ratio ♦ Not based on financial need

■ May require a co-signer

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What it means to accept a loan

■ Accepting responsibility for repaying the money you borrow

■ Before you borrow, ask:♦ Is the college or program a good investment?♦ Does your loan make good financial sense?♦ Are there other options?♦ What is the true cost of your loan?♦ Can you repay it?♦ What are your rights and responsibilities?

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Repaying your loan

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Making repayment easier

■ Pay as you go■ Sign up to have your loan payments

taken directly from your bank account■ See if loan consolidation makes sense■ Let your loan servicer know if you can’t

make your payments■ Don’t default

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Sample financing plan

http://californiacolleges.edu/finance/finance.asp

Student: SerenaAge: 18Status: Single (dependent on parents)Housing: At home with parentsParent income: $40,000

(A) 2011-12 CSU cost of attendance (living at home with parents):Fees/tuition: $5,472Books/supplies/room/board/misc. expenses: $9,756

$15,228

(B) Grant assistance totalSerena is eligible for grant assistance based on her family’s financial resources. The campus aid office pulls together grant aid from a variety of sources, including federal Pell Grants, state Cal Grants and the CSU’s own grant funding.

$9,680

(A - B) = Net cost to familyThe net cost is the amount that Serena’s family must pay after need-based grants are taken into account.

$5,548

MANAGING THE NET COSTParents and students work together to cover the net cost using resources provided by the college, including parent and student education loans, part-time work during the academic year, and savings from summer earnings.

The net cost is not due all at once. Many costs, such as living expenses, are incurred over time.

Here is a sample of how Serena’s family might cover her net cost.

Serena’s parentsCombination of current earnings, savings or a parent loan: Serena’s parents would be expected to contribute $926 for the year.

$926

SerenaStudent part-time work during academic year:Student education loans:Savings from summer jobs:

$0$2,981$1,641

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Net price calculators

■ Congress passed a law requiring all colleges to offer a “net price calculator” on their websites♦ Allows prospective students to figure out

how much it will cost them to go to college♦ Compare net price of one school to

another school

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Spending smart

■ Get organized ♦ Set up separate files♦ Keep them in a safe place

■ Create a monthly spending plan and stick to it

■ Avoid using credit cards ■ Start saving

♦ No matter how little, set aside something every month

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Useful websites

♦ ACT: www.actstudent.org♦ AmeriCorps: www.americorps.gov♦ Cal Grants: www.calgrants.org♦ California Cash for College workshops:

www.californiacashforcollege.org ♦ College Board: www.collegeboard.org ♦ California colleges: www.californiacolleges.edu ♦ College Savings Plan: www.scholarshare.com♦ ECMC: www.ecmc.org♦ FAFSA: www.fafsa.gov ♦ Federal Financial Aid: www.studentaid.ed.gov

Thank you

© California Student Aid Commission, 2011. © ECMC, 2011. All rights reserved.